Photo by Mikhail Nilov

Do not fall for common mistakes that people commit when paying off debt.

One of the most accurate—and unhelpful when trying to get out of debt—is this tip: avoid debt in the first place. While that is an excellent recommendation, it is impossible for many, especially regarding home and school loans.

If you slowly added to your debt, primarily with a mortgage, then student loans, and maybe now with credit card debt that keeps solidly increasing or a vehicle loan that you have added to the mix, here are helpful pointers on what one must NOT do when you are paying off debt.

Debt Mistakes To Avoid

1. Not building an emergency fund. How dare this article start a debt reduction post by telling you to save money for a rainy day? Having a separate savings account you add to is essential. It aids you to have something to draw on when things come up to avoid adding to your credit card debt. 

2. Not acknowledging what caused your debt in the very first place. It can be genuinely tempting to want to move on with very little to no look back at what decisions and circumstances led to where you are today financially, but do not do it! As challenging as it may be, take the effort and time to look back at your earlier decisions. Knowing these factors will aid you in making better decisions moving forward.

3. Need to make a budget or adequately budgeting. Budgeting is only some people’s tea, but people can use it. One of the right ways to get out of debt is to create a budget. Try the budgeting feature in online banking or use the paper and pencil method to break down how much you spend and make each month. Try doing this twice. One with your actual spending habits as they stand today and one with ways you will adjust or trim your budget to put more toward tackling debt. Be sure to include expenses that only occur a few months, such as a car, home maintenance, or events.

4. Paying off too much. Yes, you are excited to turn a new page and want to get out of debt as soon as possible. However, the reality is that getting out of debt is a steady-and-slow journey that you can plan on taking years, depending on how dedicated you can be and the total debt. Paying off your debts a minimum at a time ensures you can make a more significant dent in your debts AND still have enough to cover your monthly expenses.

5. Making the same decisions or not making any changes. It is a fact that humans are creatures of habit, but it is those habits that make getting out of debt so tricky. Buying the same things, shopping at the same stores, going to the same restaurants, and stopping at the same gas stations will eventually lead to the same spending habits. Changing your spending habits means saying goodbye to old spending patterns and developing new, healthier-for-your-budget activities. Without a change in practices, you are destined to perpetuate the cycle of debt and continue making the same choices. 6. Not telling anyone or doing it alone. Debt is not something you put on parade or share with many others—and this article is not advising you to shout it from the rooftops—but it does recommend telling a trusted friend. Having that friend to talk to can help you stay accountable for your debt reduction goals. If you do not have someone you feel comfortable sharing your getting-out-of-debt plans with, tell it to the expert at the Law Offices of Ronald E. Stadtmueller! You can meet with a Debt Relief San Diego Attorney for free, and we can give you some constructive things to think about, such as budgeting tips on when to refinance, balance transfer, debt consolidation options, and more. In our struggling economy, you deserve relief when crushed by overwhelming debt. At the Law Offices of Ronald E. Stadtmueller, we fight for your right to make a fresh start and free you from unmanageable debt and irritating creditors. Trust us, for we draw on over 30 years of experience guiding clients in California through bankruptcy. Allow our attorney to help you regain a firm financial footing now!

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